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Islamic Reit shortage seen boosting demand for Johor's new trust

Johor Corp plans to list RM900m Al-Salam Reit, expects to deliver returns of around 6.3 per cent in 2016

Published Wed, May 20, 2015 · 09:50 PM
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Kuala Lumpur

DEMAND for Malaysian Islamic real estate investment trusts (Reits) may withstand a sluggish property market as their steady rental income is popular with pension funds amid a shortage of syariah-compliant assets.

Johor Corp, the investment company of the country's southern Johor state, plans to list the RM900 million (S$333 million) Al-Salam Reit, said Kamaruzzaman Abu Kassim, the company's president. The prospectus will be registered by July and the trust expects to deliver returns of around 6.3 per cent in 2016, he said.

Islamic lenders in Malaysia are facing a shortage of investing options with worldwide sukuk issuance down 28 per cent so far this year. The South-east Asian nation's US$1.5 billion glob…

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